Economic Agenda

Tonight I will set out a better path, an agenda for a nation that
competes with confidence, an agenda that will raise standards of
living and generate new jobs. Americans should not fear our economic
future, because we intend to shape it.

Keeping America competitive begins with keeping our economy
growing. And our economy grows when Americans have more of their own
money to spend, save and invest. In the last five years, the tax
relief you passed has left $880 billion in the hands of American
workers, investors, small businesses and families. And they have used
it to help produce more than four years of uninterrupted economic
growth. Yet the tax relief is set to expire in the next few years. If
we do nothing, American families will face a massive tax increase they
do not expect and will not welcome.

Because America needs more than a temporary expansion, we need more
than temporary tax relief. I urge the Congress to act responsibly, and
make the tax cuts permanent.

Keeping America competitive requires us to be good stewards of tax
dollars. Every year of my presidency, we've reduced the growth of
nonsecurity discretionary spending, and last year you passed bills
that cut this spending. This year, my budget will cut it again and
reduce or eliminate more than 140 programs that are performing poorly
or not fulfilling essential priorities. By passing these reforms, we
will save the American taxpayer another $14 billion next year and stay
on track to cut the deficit in half by 2009. I am pleased that members
of Congress are working on earmark reform, because the federal budget
has too many special interest projects. And we can tackle this problem
together if you pass the line-item veto.

We must also confront the larger challenge of mandatory spending, or
entitlements. This year, the first of about 78 million baby boomers
turn 60, including two of my dad's favorite people, me, and President
Clinton. This milestone is more than a personal crisis. It is a
national challenge. The retirement of the baby boom generation will
put unprecedented strains on the federal government. By 2030, spending
for Social Security, Medicare and Medicaid alone will be almost 60
percent of the entire federal budget. And that will present future
Congresses with impossible choices—staggering tax increases,
immense deficits or deep cuts in every category of spending.

Congress did not act last year on my proposal to save Social
Security. Yet the rising cost of entitlements is a problem that is not
going away. And every year we fail to act, the situation gets
worse. So tonight, I ask you to join me in creating a commission to
examine the full impact of baby boom retirements on Social Security,
Medicare and Medicaid. This commission should include members of
Congress of both parties and offer bipartisan answers. We need to put
aside partisan politics and work together and get this problem solved.

Keeping America competitive requires us to open more markets for all
that Americans make and grow. One out of every five factory jobs in
America is related to global trade, and we want people everywhere to
buy American. With open markets and a level playing field, no one can
outproduce or outcompete the American worker.

Keeping America competitive requires an immigration system that
upholds our laws, reflects our values and serves the interests of our
economy. Our nation needs orderly and secure borders. To meet this
goal, we must have stronger immigration enforcement and border
protection. And we must have a rational, humane guest-worker program
that rejects amnesty, allows temporary jobs for people who seek them
legally and reduces smuggling and crime at the border.

Keeping America competitive requires affordable health care. Our
government has a responsibility to help provide health care for the
poor and the elderly, and we are meeting that responsibility. For all
Americans, we must confront the rising cost of care, strengthen the
doctor-patient relationship and help people afford the insurance
coverage they need. We will make wider use of electronic records and
other health information technology to help control costs and reduce
dangerous medical errors. We will strengthen health savings accounts
by making sure individuals and small business employees can buy
insurance with the same advantages that people working for big
businesses now get. We will do more to make this coverage portable, so
workers can switch jobs without having to worry about losing their
health insurance. And because lawsuits are driving many good doctors
out of practice, leaving women in nearly 1,500 American counties
without a single ob-gyn, I ask the Congress to pass medical liability
reform this year.

Keeping America competitive requires affordable energy. And here we
have a serious problem. America is addicted to oil, which is often
imported from unstable parts of the world.

The best way to break this addiction is through technology. Since
2001, we have spent nearly $10 billion to develop cleaner, cheaper and
more reliable alternative energy sources. And we are on the threshold
of incredible advances. So tonight, I announce the Advanced Energy
Initiative, a 22 percent increase in clean-energy research at the
Department of Energy to push for breakthroughs in two vital areas. To
change how we power our homes and offices, we will invest more in
zero-emission coal-fired plants, revolutionary solar and wind
technologies and clean, safe nuclear energy.

We must also change how we power our automobiles. We will increase our
research in better batteries for hybrid and electric cars and in
pollution-free cars that run on hydrogen. We will also fund additional
research in cutting-edge methods of producing ethanol, not just from
corn but from wood chips and stalks or switch grass. Our goal is to
make this new kind of ethanol practical and competitive within six
years.

Breakthroughs on this and other new technologies will help us reach
another great goal, to replace more than 75 percent of our oil imports
from the Middle East by 2025. By applying the talent and technology of
America, this country can dramatically improve our environment, move
beyond a petroleum-based economy and make our dependence on Middle
Eastern oil a thing of the past.

And to keep America competitive, one commitment is necessary above
all. We must continue to lead the world in human talent and
creativity. Our greatest advantage in the world has always been our
educated, hard-working, ambitious people, and we are going to keep
that edge. Tonight I announce the American Competitiveness Initiative,
to encourage innovation throughout our economy and to give our
nation's children a firm grounding in math and science.

First, I propose to double the federal commitment to the most critical
basic research programs in the physical sciences over the next 10
years. This funding will support the work of America's most creative
minds as they explore promising areas such as nanotechnology and
supercomputing and alternative energy sources. Second, I propose to
make permanent the research and development tax credit to encourage
bolder private-sector initiative in technology. With more research in
both the public and private sectors, we will improve our quality of
life and ensure that America will lead the world in opportunity and
innovation for decades to come.

Third, we need to encourage children to take more math and science and
to make sure those courses are rigorous enough to compete with other
nations. We've made a good start in the early grades with the No Child
Left Behind Act, which is raising standards and lifting test scores
across our country. Tonight I propose to train 70,000 high school
teachers to lead Advanced Placement courses in math and science, bring
30,000 math and science professionals to teach in classrooms and give
early help to students who struggle with math, so they have a better
chance at good high-wage jobs. If we ensure that America's children
succeed in life, they will ensure that America succeeds in the world.

Preparing our nation to compete in the world is a goal that all of us
can share. I urge you to support the American Competitiveness
Initiative, and together we will show the world what the American
people can achieve.